The procurement of an innovation involves motivating a research effort to generate a new idea and then implementing that idea efficiently. If research efforts are unverifiable and implementation costs are private information, a trade-off arises between the two objectives. The optimal mechanism...

Abstract: We discuss public procurement instruments for acquiring innovation, focusing on the European Pre-commercial Procurement, Procurement of Innovative Solutions and Innovation Partnerships. We analyse in particular how firms' innovation incentives are affected by: (i) economies of scope...

This study provides the first quantification of buyers' role in the outcome of R&D procurement contracts. We combine together four data sources on US federal R&D contracts, follow-on patented inventions, federal public workforce characteristics, and perception of their work environment. By...